Tamarack Valley Energy Ltd.: Non-Core Property Divestiture
Tamarack Valley Energy Ltd. (“Tamarack Valley” or the “Company”) has engaged Sayer Energy Advisors to assist the Company with the sale of certain non-core natural gas interests located in the Forty Mile, Pakowki and Quaich areas of southern Alberta (the “Properties”).
The Properties consist of operated, high working interest natural gas production. Tamarack Valley is selling the Properties in order to focus its operations on its core assets.
Average daily production net to Tamarack Valley from the Properties for the month of March 2022 was approximately 2.6 MMcf/d of natural gas (442 boe/d).
Operating income net to Tamarack Valley from the Properties in the first quarter of 2022 averaged approximately $180,000 per month, or $2.2 million on an annualized basis. Tamarack Valley is forecasting monthly net operating income to exceed $300,000 based on current pricing.
As of April 2, 2022, Tamarack Valley’s net deemed asset value for the Properties was $7.6 million (deemed assets of $11.8 million and deemed liabilities of $4.2 million), with an LMR ratio of 2.80.
GLJ Ltd. (“GLJ”) prepared an independent reserves evaluation of the Quaich property as part of the Company’s year-end evaluation (the “GLJ Report”). The GLJ Report is effective December 31, 2021 using an average of GLJ, McDaniel & Associates Consultants Ltd. and Sproule Associates Limited’s January 1, 2022 forecast pricing. GLJ estimates that, as of December 31, 2021, the Quaich property contained remaining proved plus probable reserves of 9.3 Bcf of natural gas (1.6 million boe), with an estimated net present value of $8.1 million using forecast pricing at a 10% discount.
Tamarack Valley internally updated the reserves associated with the Quaich property as of April 1, 2022, using an average of GLJ, McDaniel & Associates Consultants Ltd. and Sproule Associates Limited’s April 1, 2022 forecast pricing. The update increased the PDP net present value at a 10% discount to $7.0 million.
More specific information relating to this divestiture is available at www.sayeradvisors.com. A package of more detailed confidential information will be sent to any party executing a Confidentiality Agreement (copy attached).
Cash offers relating to this divestiture will be accepted until 12:00 pm on Thursday, June 16, 2022.
For further information please feel free to contact: Ben Rye, Grazina Palmer, or Tom Pavic at 403.266.6133.
- Asset Sales and Acquisitions